Salesforce.com Social-Media Tools to Challenge Likes of Jive

Nov. 30 (Bloomberg) -- Salesforce.com Inc. is introducing
software that helps customers create online marketing campaigns
-- and tightens ties between its social-media tools and flagship
software, a development that may spur the company’s own sales.

Salesforce, the largest seller of online customer-management software, is bringing out a product called the Social
Marketing Cloud, Senior Vice President Marcel LeBrun said in an
interview. The product employs technology acquired in the
purchase of Radian6 Technologies Inc.

Customers can send targeted marketing offers to Web users
on the basis of conversations on Twitter.com and other social-media sites, LeBrun said. The software further integrates
Radian6’s capabilities with those of Salesforce’s Web
applications for managing customer relationships, he said.

The San Francisco-based company is competing with Jive
Software Inc., Yammer Inc. and Mzinga Inc. to help businesses
understand and act on the conversations happening on Twitter,
Facebook.com and other websites, said Richard Davis, an analyst
at Canaccord Genuity in Boston.

“Salesforce is in the land-grab phase of the market,
trying to beat Jive, Yammer and Mzinga to the customer,” Davis
said in an e-mail. He has “buy” rating on Salesforce shares.

The stock rose 7.1 percent to $118.42 at the close in New
York. Salesforce shares have retreated 10 percent this year.

‘Social Hub’

The Social Marketing Cloud includes “social hub” software
that more closely ties Radian6’s technology for monitoring
online conversations to other Salesforce products, LeBrun said.
A marketing manager at a securities firm could use the software,
for example, to target a person who may be a prospective
customer because of comments made on a social-media site.

Salesforce Chairman and Chief Executive Officer Marc
Benioff plans to discuss the software at the company’s
Cloudforce conference in New York today.

Benioff has taken steps to expand Salesforce’s market
beyond Web-based software for managing sales and customer
service by introducing social-media tools that let employees
collaborate on projects. He’s also seeking to help companies and
ad agencies tap into the Web users’ online conversations.

In August, Salesforce introduced a higher-priced option for
its Winter ‘12 software, which lets sales managers monitor
what’s being said on the Web about their company and its
products.

Other efforts have been slower to yield returns. Salesforce
had to cut the price of the first version of its Chatter
software for building corporate social networks to $15 a user
monthly from $50.

Model Metrics

Salesforce has been acquiring companies to build its
social-media efforts. The company completed its $326 million
acquisition of Radian6, where LeBrun was CEO, on May 2.
Salesforce said on Nov. 14 it would buy Model Metrics Inc., a
social-media consulting company based in Chicago, for an
undisclosed price.

“You need consultants who can explain the technology,”
said Pat Walravens, an analyst at JMP Securities LLC in San
Francisco. “That was a problem for Salesforce.” Walravens has
a “market outperform” rating on the shares.

Salesforce will provide the marketing cloud software
through annual licenses, LeBrun said. Radian6’s software had
yielded monthly rather than annual fees. That stoked analysts’
concerns that some of Salesforce’s acquisitions weren’t adding
to its deferred-revenue account, a component of how Wall Street
measures sales potential.